Understanding the Impact of Trails on Residential Property Values in the Presence of Spatial Dependence

Abstract

This paper examines the impacts of a multi-purpose trail on residential property values in a hedonic model. Using a large housing data set in combination with street network distances,we show that proximity to trail entrances positively effects property values. Among other things, our study compares the hedonic model results from three different spatial specifications.We pay specific attention to the direct and indirect effects on residential property prices associated with potential changes in house characteristics. In addition, our study predicts property values around trail entrances using a "modified spatial predictive process" approach that is well suited for capturing spatial dependence in large data sets.

JEL Classification: C11, C21, R21